LONDON  World stocks took another beating Monday, although some markets showed resilience by bouncing off session lows, as global economic gloom darkened investors' outlook.

Asian markets started the week with a thud, with stocks in Hong Kong falling nearly 13 percent and Japan's Nikkei index closing at its lowest level in over a quarter century.

In Europe, markets ended off their lows as some bargain hunters were cheered by a mild rally on Wall Street that faded at the close. Latin American shares, meanwhile, fell further on concerns the region's export-oriented economies will suffer as world demand slacks.

Investors are wary of wading back into equities, worried a stream of economic data from the U.S. this week could bring more bearish news about the world's largest economy and trigger another round of selling, analysts said. Selling by investment managers, bracing for another wave of redemptions, also fed the declines, they said.

"Investors aren't totally convinced the worst is over yet," said Alex Tang, head of research at Core Pacific-Yamaichi in Hong Kong.

The day's most dramatic action came in Asia, where the Nikkei index in Japan closed down 6.4 percent to 7,162.90 -- the lowest since October 1982 -- as the financial crisis raised recession fears and drove up the yen, piling the pressure on the country's exporters.

Hong Kong's Hang Seng Index tumbled 12.7 percent to 11,016, its lowest close in more than four years and biggest daily decline since 1991. China's benchmark, the Shanghai Composite Index, lost 6.3 percent, or 116 points, to 1,723. It is now down about 72 percent from its peak about a year ago.

Only South Korea's market managed to eke out gains, perhaps in part because of a big interest rate cut there. The benchmark Kospi ended 0.8 percent higher at 946.45.

The sharp declines across most of Asia came amid another round of government measures to boost their markets. In South Korea, the central bank slashed its key interest rate Monday by three-quarters of a percentage point -- its biggest cut ever -- to prevent Asia's fourth-largest economy from lurching into recession.

Australian and Hong Kong central bankers injected funds into their markets to ensure liquidity. Japan's prime minister urged officials to draw up measures to calm volatile stock markets and to fend off further fallout from the crisis.

In Europe, stocks fell sharply early on but recovered on the back of an initial upturn in U.S. stocks, which were helped in part by U.S. data showing sales of new single-family homes jumped 2.7 percent in September, far better than economists' expectations for a drop. The Dow industrials, however, ended Monday down 203.18, or 2.42 percent, to 8,175.77 after earlier rising by as many as 220 points.

That short-lived U.S. rally coaxed some investors looking to pick up European stocks on the cheap. Germany's benchmark DAX index managed to swing into positive territory, closing 38.97 points higher at 4334.64 after being down almost 5 percent. The rally was helped by a 147 percent jump in Volkswagen AG stock after Porsche said it plans to lift its stake in the automaker to 75 percent by 2009.

But while European stock markets recovered from earlier lows, none of the major indexes managed to post an outright gain on the close. The British FTSE 100 fell 30.77 points, or 0.8 percent to 3852.59, while France's CAC 40 fell 4.0 percent decline to 3067.35.

John Higgins at Capital Economics noted stocks are starting to look cheap, but also said any recovery from the economic contraction in the U.S. next year will be slow.

"The bottom line for equity investors is not to expect much more than modest gains until the economy comes out of the doldrums," Higgins said.

One emerging cause of concern has been the rapid appreciation of the Japanese yen as investors who have in the past borrowed in Japan to invest in higher-risk economies are undoing those trades. This has caused a massive repatriation of funds into Japan, causing the yen to rise in value against other currencies.

The movements have been so sharp as to worry politicians and central bankers.

The world's seven leading industrial nations issued a statement Sunday warning about the "recent excessive volatility" in the value of the Japanese currency, which is rising against the U.S. dollar toward the 90 yen level and near 13-year highs.

"We continue to monitor markets closely, and cooperate as appropriate," the G7 said.

The statement has raised the prospect of coordinated intervention to stem the yen's appreciation and could be the precursor to joint interest-rate reductions too to help calm markets and provide some impetus to the stalling global economy. The U.S. Federal Reserve is already expected to cut its key interest rate a half percentage point to 1 percent at a two-day meeting that ends Wednesday. European Central Bank president Jean-Claude Trichet also indicated a rate cut was possible at the bank's meeting next month.

While the yen and the dollar have generally fared well this month, the euro and pound have slumped on expectations their economies are exposed to vulnerable emerging economies, such as Hungary and Ukraine, which are in talks with the International Monetary Fund to receive emergency aid.

The 15-nation euro slid to $1.2522 in late New York trading from the $1.2612 it was worth Friday. Earlier in the session, the euro bottomed at $1.2333, its lowest point since April 2006.

In Latin America, Brazil's Ibovespa stock index ended down 6.5 percent at 29,435, as investors continued to flee Brazilian equities on concerns a global recession and curtailing demand for exports to the U.S. and Europe.

In oil, Light, sweet crude for December delivery fell 93 cents to settle $63.22 a barrel in trading on the New York Mercantile Exchange after dropping to its lowest point since May 2007. Oil prices have plunged more than 57 percent from a record $147.27 in mid-July on expectations a global recession will slash demand.

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